07-20-2006, 07:22 AM
Rosalind and the AuctionGuild's TAGNotes on the fee hike. The advice A. expect more store fee hikes B. Start your own website
Quote:TAG predicted that ebaY would announce an increase US store fees in July, well, our
prediction was a month too early. Effective 22 Aug, ebaY is increasing store listings
insertion fees drastically, and jumping final value fees. In light of the increase in
ebaY store fees in Australia, including doubling the final value fee, adding a fee
schedule more like the auction insertion schedule (10 to 50 cents) and adding other
fees, sellers should note that ebaY frequently uses the AU and other non US sites as
a testing ground for what ebaY is planning to next implement in the US, so this US
fee increase might just be the first taste.
ebaY stock has taken a heavy hit since their last stock split. An undiluted (taking
out all the splits) share of ebaY stock (if you bought one share at IPO or before the
first split, you would now have 24 shares of ebaY stock) is worth $622.32, heading
back down to where it was in 2003. Needless to say, ebaY needs to do something
to convince potential stock buyers that their stock still has the potential to increase
in price (ebaY has never paid a dividend, so buying low and selling high is the only
way stockholders can make money on their stock) . They also need to keep
institutional sellers from dumping their stock, which could send ebaY's stock into a
tailspin. Other than selling stock, ebaY only has one way to generate revenue, and
that is out of the seller's pockets, particularly in the US and Germany. ebaY's
listings have been flat for several years, so raising prices on auction and fixed price
listings would probably be self defeating. Stores fee increases are the only option at
this time.
It appears that ebaY's attempts in Asia have been a failure. Yahoo defeated ebaY in
Japan, and Alibaba's Taobao auction site (partnered with Yahoo), has the edge in
China, and between them they have probably put the final nail in ebaY's very
expensive Asian expansion moves. Things must not be going well in ebaY UK,
evidenced by the almost constant promotions to attract listings, with ebaY Canada
showing a similar pattern. ebaY India appears to be the biggest online auction site
in India, but it is still a small site, with about 2% of the listings as compared to the
US. Add an overpriced purchase of Skype, ebaY's near perfect record of losing all
the value out of almost every company they have purchased or partnered with, and
where ebaY is heading, becomes very questionable.
Fraud remains a big issue, real or perceived, limiting the numbers of buyers ebaY
can attract. Buyers receive second chance offers on items for which they did not
have the winning bid, that turn out to be scams, with ebaY's non existent security
allowing the scammers access to bidders email addresses.  ebaY and PayPal's so
called insurance programs take forever to provide restitution to buyers, when the
fine print does not catch the buyer, preventing them from receiving anything. The
information on the site that would help users to avoid fraud remains so well hidden,
only a pro can find it.
Sellers are endlessly disillusioned by ebaY's lack of customer support, unfair unjust
and unequal policies regarding policing their site for ebaY illegal items, and ebaY's
failure to remove scam listings.  After all these years, ebaY still has no procedure
for dealing with suspended sellers, just slams the door in the seller's face, informs
all the seller's buyers and bidders that deals should not be completed, and makes
the seller look like a scammer. In cases where ebaY has made a mistake, and
restores the seller, nothing is done as restitution to the seller, nor to restore their
listings or inform their bidders that ebaY had made a mistake. Now ebaY wants
sellers to provide phone contact support through Skype, to potential buyers, but
ebaY wont do the same for their customers, the seller.
Rumors of ebaY looking for a buyer are appearing more frequently, and Meg
Whitman has stated that she feels she has fulfilled all her commitments to ebaY, so
we will soon hear of her moving on. Some of the rats have already abandoned the
ship, Jeff Jordan comes to mind, and Rajiv Dutta (remember Rajiv? He is the one
who thinks sellers are trash who "clutter up" the site) has been assigned to replace
him. None of this adds up to anything good.
So what should sellers do? What we have been suggesting they do for years.Â
Develop your own website. Use that website as the hub for all your online selling.Â
Remember that search engines are the name of the game, and if you just think of
ebaY as another search engine, another way of advertising your site, you can use it
to expand your customer base. You have to remain within the lines of ebaY's
written and unwritten rules, but a smart seller can do that and still use ebaY to grow
their own site. List on other sites. Most are free or only charge a final value fee
when something sells. Get indexed on Froogle. The more you appear on the net,
the more frequently you will turn up in search engines. Do not use ebaY as your
primary method of selling. They are an unreliable and capricious partner, who does
not care if someone sells on their site or not, and if they destroy a seller's business,
care even less.
